To improve the outcome of trauma victims and of patients undergoing high- blood-loss surgical procedures and to avoid the many serious complications of blood transfusion, there is a need for an oxygen-carrying blood substitute. Synthetic erythrocytes composed of liposome-encapsulated hemoglobin (L(HB)) represent one of the significant research efforts in this direction. This study is aimed at formulating hemoglobin (Hb) containing liposomes with extended circulation time by using "Stealth" liposomes coated or uncoated with polymers. Liposomes are phospholipid bilayer vesicles which have the capacity to entrap a wide variety of compounds. The proposed study attempts to encapsulate Hb in various "Stealth" liposomal formulations and polymer coating technique will be applied to improve the circulation time of Hb, Liposomes will be characterized by transmission and freeze fracture electron microscopy and oxygen affinity and cooperativity of L(Hb) will be determined. The dependency of this formulation on the composition and concentration of "Stealth" liposomes, fluid- and gel- state conditions of "Stealth" liposomes and Hb: liposome ratio will be assessed in order to determine the optimum formulation criteria for the entrapped L(Hb). To further increase circulation half-time of L(Hb), polymers will be employed to coat the liposome for comparative studies on improved circulation time. In-vivo studies will be conducted on several formulations of polymer coated and uncoated "Stealth" L(.b) and the relative circulation time and other in- vivo performance (e.g., determination of lipocrit, hematocrit value, respiration, heart rate, blood pressure and overall survival) will be assessed using rat as the animal model.